Trust is a dead word! The EU political elite have sapped the hopes and aspirations of millions of ordinary people throughout Europe. Nearly a decade of austerity has cheated them out of €billions to save the French and German banks.
In a stampede to maximise their profit the European banks lead the ‘Charge of the Light Brigade’ into the cesspit of derivatives. They wanted their cut, to cash in in the quick buck world of finance. They stood to make €millions but, there is always a but, the 2008 financial crash squeezed their balls till they screamed.
Thoughtless in their pursuit of dosh (€/£/$) and fearing they might lose out and look like idiots to the rest of the financial mob, they galloped headlong into the fray. BOOM! BOOM! Their bonuses blowing in the wind they trundled back to beg governments to bail them out. Governments did at phenomenal cost and then passed the bill to the ordinary people. Austerity!
“I witnessed first-hand what I can only describe as a naked class war that targeted the weak and scandalously favoured the ruling class.”1
The Double Whammy
The people were bludgeoned twice. This was a heartless mugging; the subprime mortgage crisis left millions without homes, struggling to survive and then came a decade of austerity. Such is irony. Joseph Stiglitz shoots with both barrels when he states, “…U.S. subprime crisis meant exploiting the poorest and least-educated among us.”2
As the 2008 crisis hit the governments of the EU passed power over to the troika: the European Commission (EC), the European Central Bank (ECB) and the International Monetary Fund (IMF). All decisions about bailing-out fell to them. The crisis appeared to suggest the collapse of the EU.
Angela Merkel berated the Americans for causing the debacle but soon had to eat her words as she handed over an initial €406 billion to German banks. She hadn’t realised they were burst too. Moreover, the German banks had previously loaned $477 billion to the weaker states of the EU. Later, Merkel would hand over another huge amount.
The banks of France, Germany, Netherlands and UK had a $30 trillion exposure, which meant that if the slightest thing went wrong they would collapse. A massive bailout was needed and quick.3 The troika with their gang of technocrats were called to action.
Five countries needed transfusions: Spain, Portugal, Ireland, Italy and Greece. In 2010 Greece received a €110bn loan from the troika. “As soon as the bailout loans gushed into the Greek finance ministry, ‘Operation Offload’ began: the process of immediately siphoning the money back to the French and German banks.”4
Of the money given over some 66% came from the EU taxpayer and 33% from taxpayers throughout the world. Thus the banks were salvaged at the expense of the people. Greece was left to cope. During the period 2010 – 2012 Greek government spending dropped by 15%. More bailouts required.5
A second then a third bailout was needed in 2012 and 2015. The Greeks got the blame for mishandling their finances as the people of Europe made snide remarks about the Greeks, not realising that it was Merkel and gang passing it on to the banks.
Little Cyprus suffered too at the hands of the troika. In 2013 Cyprus got a 10bn bailout but the strings attached were severe, the Popular Bank (Laiki Bank) was forced to close. Like other countries within the block Cyprus had to accept austerity. Wikipedia March 2013
Outside of the corridors of power the deal was condemned.
- Paul Mason, then a reporter for BBC Newsnight queried,
“What is Germany doing? It triggered the Cyprus crisis and is playing hardball,…”
- Economist Richard D. Wolff described it as “blackmail”.
- Dr Jeffery Stacy believed “…it hurt Cyprus and Europe”.
- The economist magazine described the deal as, “…short-sighted and self-defeating.”
They were small, they were weak, they were used as a lesson plan to the rest; don’t step out of line! Democracy be damned – and it was! The BBC put the blame firmly in Merkel’s corner. While the Guardian newspaper warned that Cyprus would suffer.
The bailout of Cyprus, “… raised profound questions about the democratic nature of EU decision-making.”
The people had no say, democracy was ignored, the needs of the elite were met. Meanwhile the poor had to take the medicine without exhibiting any symptoms.
Anyone who reads Yanis Varoufakis book Adults in the Room and still believes in the EU need to see someone!!! But don’t take the word of Varoufakis. The German finance minister Wolfgang Schäuble makes it as plain as daylight when speaking to Varoufakis:
“In the Eurogroup you are probably the one who understands that the eurozone is unsustainable. The eurozone is constructed wrongly.”6
The ‘powers’ may argue that they done what they did to save Europe for democracy. It was merely a temporary suspension and, strong arm tactics were necessary to achieve restitution. BUT!
- The cost was one-sided. Ordinary Joe paid in full.
- Banks were saved without consequential costs.
- Banks continue to make huge profits and top employees to make awesome bonuses.
- The ‘powers’ never explained their actions
- The ‘powers’ succeeded in smashing the concept of fairness.
- And succeeded in destroying trust.
- Political leaders could not think of an alternative plan.
- The elite went scot free!!!
Democracy was cast aside; kicked in the balls and dismissed as a troublesome kid. There can be no clearer evidence that the people were used as pawns to benefit the elite.
“It is unfair to accept benefits but refuse to pay.” The bankers did!!! Johnathan Wolff 7
- Yanis Varoufakis, Adults in the Room (481)
- Joseph Stiglitz, The price of Inequality (xlv11)
- Y V (38)
- YV (27)
- YV (19 + 499 note)
- YV (407)
- J. Wolff, Political Philosophy Third Edition (59)